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Τετάρτη, 23 Νοεμβρίου 2016

MSI: Dry Bulk Market Heading Into a Firm Festive Season

After a steady fall in average daily TCE spot earnings in
October, November saw an inflection point for Capesizes as the dry bulk market
is sailing into a firm festive season, swiftly followed by a New Year comedown,
according to research and consultancy firm Maritime Strategies International
(MSI).

With rates soaring to over USD 16,000 per day,
the Capesizes saw their highest rates since mid-2015. Some of this strength has
translated to the Panamax market, although Supramax and Handysize earnings have
been broadly unaffected.

A basket of key commodity prices, including iron
ore, coking and steam coal, have surged in recent weeks, with falls in domestic
supplies in China a key driver. This trend is forecast to continue through the
fourth quarter but weaker iron ore and coal trade will impact Capesize and
Panamax demand in the near term.

“On this basis it is difficult to build a
reliable view on how long this freight rate uptick will last, but in any case we
expect spot rates to fall back below operating costs in the New Year. This will
be mainly as a result of weaker iron ore trade in Q1, but by Q2 we expect to see
stronger Chinese coal production limiting coal import requirements,” Fray
added.

The MSI outlook for the Panamax market will be
impacted by weaker coal demand to India, an effect magnified by the significant
proportion of imports carried in Panamax vessels. Some improvement is expected
towards the end of this year, but spot earnings are forecast to drop back again
in early 2017 to below USD 6,000 per day, with barely any improvement into the
second quarter of the year.

The New Year is also likely to see rates fall in
the Handysize sector, partly due to expectations of strong Ultramax deliveries
in the first quarter. However, MSI’s forecast of USD 6,000 per day in January
and USD 7,300 per day in April is broadly positive, particularly when compared
with the MSI outlook for Capesize and Panamax markets.